360 Degree Feedback – What is it? What are the benefits of using it?

April 24, 2018 - Gini Beqiri

Providing feedback for development is useful for all employees because it helps them understand their strengths and weaknesses and how to progress in their career. Using a 360 degree feedback system is one of the methods for gathering and providing this information. In this article, we discuss 360 degree feedback, including its benefits and limitations.

What is 360 degree feedback?

360 degree feedback, also known as multi-rater feedback, is a system in which anonymous feedback is gathered about a member of staff from various people they have working relationships with. This is usually their managers, peers, direct reports, subordinates - hence the name "360 degree". It's designed so a range of people can share their opinion to provide a well-rounded view on the individual.

It's used mostly as a development tool because it provides information about a subject's work competencies, behaviour and working relationships. It's also mainly used for individuals higher up in the organisation's hierarchy.

The 360 feedback system process

Administering the survey:

Around 6-10 respondents complete an anonymous online feedback form.

Respondents are arranged into groups depending on the relationship with the subject, such as, manager, peers etc. If it's appropriate, feedback can also be gathered from external sources, such as clients or customers.

The surveys are competency based and the questions typically consist of: rating management competencies, such as, leadership and communication skills and open ended questions, for example, "What does X do well as a leader?"

Questions should always be regarding observable behaviour as this will be easier to quantify.

The subject of the feedback also completes the same questionnaire.

The whole process should be supervised by a manager, coach or a trainer - often external to the organisation.

Post-survey completion:

Individual answers cannot be identified as the feedback is provided as averages from the different rating groups.

Feedback is provided in a report usually created by a trusted third party and crucial areas for development are highlighted.

The information helps to create a development plan.

Those who give the feedback to the subject should be well-trained and they should provide the information objectively and constructively.

Support should be offered to help achieve the goals set, including follow-ups.

360 degree feedback strengths

If a 360 feedback system is implemented well, it can have a number of benefits for the individual, their team and the organisation:

Valuable development tool: The 360 feedback system shows the subject the differences between how they see themselves and how others see them. This increases their self-awareness which means that the subject is more conscious of their personality, strengths, weakness, beliefs, motivations etc. With this information they can adjust their behaviour and identify their training needs. Consequently, the subject can become more effective in their role and for the role they may be aiming for.

Multiple sources: A variety of people have contributed to the feedback so the information is thought to be more valid and objective than feedback from, for example, just one manager. Also, the feedback is more likely to be accepted if multiple individuals "agreed" on the answers.

Motivation: Knowing multiple individuals gave the same feedback provides the subject with the drive to develop.

Company competencies: The company's fundamental competencies will be reinforced, not only for the subject, but also for the respondents. During the survey the respondents will be answering questions which remind them of what behaviours and values are important to the company.

Customer service: Customer service can improve if customers and clients have completed the survey.

Method over outcomes: The 360 feedback system assesses the method rather than the outcome. It's more important to do something the right way even if it doesn't produce the correct outcome - nothing is ever certain so by focusing on the method you give yourself the best chances of producing the preferred outcome. For example, a tight deadline is coming up but a manager tells his staff that they can only work a maximum of one hour overtime a day and no work is allowed on the weekends. The manager has made this decision because he believes that stress and over-working can increase the chances of mistakes being made and of producing poorer outcomes.

Large teams or autonomous workers: This type of feedback is significant in organisations where the subject works independently or with several teams because their manager will be unable to observe everything.

Safe environment: Answers are safely given as the system is confidential. A lot of the feedback would be too uncomfortable for colleagues to share and it would probably never be given if the system was not anonymous.

Improves communication: Communication increases between the team because the subject understands how others perceive them which in turn assists with teamwork.

Addresses personality and behaviour: It helps subjects understand how their behaviour affects themselves, their department and the organisation. This is also useful for reducing conflict.

Career development: The organisation benefits by this feedback improving career development planning and execution of this. This also promotes the organisation's assurance of employee development which aids recruitment and staff retention

360 degree feedback weaknesses

If a 360 degree feedback system is implemented poorly, this can create distrust, conflict and low motivation amongst the team:

Conflicting feedback: Feedback can be conflicting and there is no way to be sure which feedback is more accurate.

Concentrating on negatives: Organisations sometimes make the mistake of discounting strengths and focusing completely on weaknesses. If all of the negatives were listed one after the other it would be discouraging for the employee - they may either shut off or not trust the feedback. Staff should be working on their weaknesses and continuing to play to their strengths.

Importance of the leader: If the organisation's leader believes that this feedback is not important or they do not contribute then it's unlikely that other organisation members will treat it seriously. When the leader thinks it's important, and that this will benefit the organisation, these beliefs will work down the hierarchy to persuade everyone else.

Smaller organisations: 360 degree feedback can be less effective in small organisations as there are fewer sources and reduced objectivity.

Vague questions: Vague questions should be avoided because it's difficult to convert the answers into measurable behaviour. Questions that will give the subject actionable information should be used.

Lack of customisation: If the survey is not tailored to the needs of the organisation it may not be useful.

Accuracy: The amount of time an individual has known the subject affects the accuracy of the feedback given. Eichinger (2004) found that staff who had been at an organisation long enough to get past first impressions (known the subject for 1-3 years), but not long enough to lose their objectivity (known the subject for more than 3 years), gave the most accurate ratings. Individuals who knew the subject for less than 1 year provided the second most accurate ratings.

Personal feedback: Respondents may provide personal rather than constructive feedback which can upset the subject and not have much value. It must be clear to staff why they're doing the survey - that it must be constructive and not personal.

Not applicable for all: It's important to keep in mind that 360 degree feedback is not useful for all organisations or for all jobs within an organisation.

Feedback never provided: Providing the feedback must be planned before the distribution of the surveys. Individuals cannot make changes if their feedback is not provided and if a development plan isn't formed.

No follow-ups: A lack of follow-ups can make the review worthless because people may not be sticking to their development plans. Follow-ups should be carried out quarterly for two years, with the survey being re-administered every 6-12 months.

Lacking anonymity: A lack of anonymity can undermine the whole process. Confidentiality must be ensured or respondents will not be truthful. Also, external coaches can be hired to assist employees through their follow-ups as staff are likely to be more comfortable speaking with external sources rather than HR.

Inter-rater reliability: Greguras and Robie (1998) found that feedback from direct reports are the least reliable from: direct reports, peers and managers. This suggests that more people are needed to contribute to create a reliable outcome.

Performance reviews: Some organisations use this 360 degree feedback format for performance reviews and it has been frequently suggested that this lacks validity:

Employees may not be trained to evaluate others' performance.

Respondents can manipulate this system, for example, one colleague may say to another "If you say X about me, I'll say X about you," or perhaps "Let's say X about her." For example, in the New York Times Kantor and Streitfeld (2015) reported this type of behaviour at Amazon.

The likelihood of manipulation increases if these reviews are used for employment decisions, such as, pay and promotions.

Trust at work decreases.

Work morale can decline when staff are given performance reviews in this format. When the 360 degree feedback system has been used for development, negative feedback is seen as constructive.

360 degree feedback has multiple weaknesses but they are mainly avoidable. This is because most of these weaknesses are mistakes linked to how the system has been explained and executed.

If effective training has been provided and there is a clear plan of how the 360 degree feedback will be used then these problems disappear, thus providing an organisation with an anonymous, reliable and valid way of providing feedback for personal development.